ENROLLED HOUSE
BILL NO. 1934 By: McCall of the House
and
Treat, Stanley, Thompson (Kristen), Bullard, Haste, Green, Seifried, Standridge, Coleman, Prieto, Daniels, Bergstrom, Rader, Garvin, Newhouse, Rogers, Woods, and Stewart of the Senate
An Act relating to students; creating the Oklahoma Parental
Choice Tax Credit Act; providing short title; providing legislative intent;
defining terms; creating the Oklahoma Parental Choice Tax Credit Program;
providing purpose; creating income tax credit for certain taxpayers beginning
in certain tax year; prescribing maximum credit amounts based on certain income
levels; directing taxpayer claiming certain credit to retain certain receipts
and submit them upon certain request; prescribing maximum amount of credits for
certain tax years; authorizing the Oklahoma Tax Commission to prescribe certain
applications and certain deadline; providing for advancement of certain credit
in installments; providing procedures for claiming credit; directing the
Commission to give first preference in making installments to certain
taxpayers; authorizing dual participation in certain program; authorizing the
Commission to conduct or contract for certain audit; authorizing prorated
recapture of credits under certain circumstances; directing certain credit
amount to be reduced if certain event occurs; requiring the posting of certain
credit amounts; requiring the State Department of Education to provide certain
notice; directing implementation of certain system; requiring coordination of a
process to verify student enrollment status; providing for promulgation of
rules; providing immunity from liability for certain actions; allowing certain
parents to intervene in certain legal proceeding; prohibiting severability of
act provisions; and providing for codification.
SUBJECT: Students
BE IT
ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:
SECTION 1.
NEW LAW A new section of law
to be codified in the Oklahoma Statutes as Section 28-100 of Title 70, unless
there is created a duplication in numbering, reads as follows:
A. This act shall be
known and may be cited as the “Oklahoma Parental Choice Tax Credit Act”.
B. It is the intent of
the Legislature that parents, legal guardians, custodians, and others with
legal authority over children in this state be able to choose educational
services that meet the needs of their individual children. The Legislature affirms that parents and
legal guardians are best suited to make choices to help children in this state
reach their full potential and achieve a brighter future.
SECTION 2.
NEW LAW A new section of law
to be codified in the Oklahoma Statutes as Section 28-101 of Title 70, unless
there is created a duplication in numbering, reads as follows:
A. As used in the
Oklahoma Parental Choice Tax Credit Act:
1. “Commission” means the
Oklahoma Tax Commission;
2. “Curriculum” means a
complete course of study for a particular content area or grade level;
3. “Department” means the
State Department of Education;
4. “Education service
provider” means a person, business, public school district, public charter
school, magnet school, or organization that provides educational goods and/or
services to eligible students;
5.
“Eligible student” means a resident of this state who is eligible to
enroll in a public school in this state.
Eligible student shall include a student who is enrolled in and attends
a private school accredited by the State Board of Education or another
accrediting association or a student who is educated pursuant to the other
means of education exception provided for in subsection A of Section 10-105 of
Title 70 of the Oklahoma Statutes;
6.
“Qualified expense” for the purpose of claiming the credit authorized by
subparagraph a of paragraph 1 of subsection C of this section means tuition and
fees at a private school accredited by the State Board of Education or another
accrediting association;
7.
“Qualified expense” for the purpose of claiming the credit authorized by
subparagraph b of paragraph 1 of subsection C of this section means the
following expenditures:
a. tuition
and fees for nonpublic online learning programs,
b. academic
tutoring services provided by an individual or a private academic tutoring
facility,
c. textbooks,
curriculum, or other instructional materials including, but not limited to, supplemental
materials or associated online instruction required by an education service
provider, and
d. fees
for nationally standardized assessments including, but not limited to,
assessments used to determine college admission and advanced placement
examinations as well as tuition and fees for tutoring or preparatory courses
for the assessments; and
8. “Taxpayer” means a
biological or adoptive parent, grandparent, aunt, uncle, legal guardian,
custodian, or other person with legal authority to act on behalf of an eligible
student.
B.
There is hereby created the Oklahoma Parental Choice Tax Credit Program
to provide an income tax credit to a taxpayer for qualified expenses to support
the education of eligible students in this state.
C.
For the tax year 2024 and subsequent tax years, there shall be allowed
against the tax imposed by Section 2355 of Title 68 of the Oklahoma Statutes a
credit for any Oklahoma taxpayer who incurs a qualified expense on behalf of an
eligible student, to be administered subject to the following amounts for each
tax year:
1. If the eligible
student attends a private school accredited by the State Board of Education or
another accrediting association, the maximum credit amount shall be:
a. (1) Seven Thousand Five Hundred Dollars
($7,500.00) or the amount of tuition and fees for the private school, whichever
is less, if the eligible student is a member of a household in which the total
adjusted gross income during the second preceding tax year does not exceed
Seventy-five Thousand Dollars ($75,000.00),
(2) Seven
Thousand Dollars ($7,000.00) or the amount of tuition and fees for the private
school, whichever is less, if the eligible student is a member of a household
in which the total adjusted gross income during the second preceding tax year
is more than Seventy-five Thousand Dollars ($75,000.00) but does not exceed One
Hundred Fifty Thousand Dollars ($150,000.00),
(3) Six
Thousand Five Hundred Dollars ($6,500.00) or the amount of tuition and fees for
the private school, whichever is less, if the eligible student is a member of a
household in which the total adjusted gross income during the second preceding
tax year is more than One Hundred Fifty Thousand Dollars ($150,000.00) but does
not exceed Two Hundred Twenty-five Thousand Dollars ($225,000.00),
(4) Six
Thousand Dollars ($6,000.00) or the amount of tuition and fees for the private
school, whichever is less, if the eligible student is a member of a household
in which the total adjusted gross income during the second preceding tax year
is more than Two Hundred Twenty-five Thousand Dollars ($225,000.00) but does
not exceed Two Hundred Fifty Thousand Dollars ($250,000.00), or
(5) Five
Thousand Dollars ($5,000.00) or the amount of tuition and fees for the private
school, whichever is less, if the eligible student is a member of a household
in which the total adjusted gross income during the second preceding tax year
is more than Two Hundred Fifty Thousand Dollars ($250,000.00), and
b. One
Thousand Dollars ($1,000.00) in qualified expenses per eligible student in each
tax year if the eligible student is educated pursuant to the other means of
education exception provided for in subsection A of Section 10-105 of Title 70
of the Oklahoma Statutes. To claim the
credit, the taxpayer shall submit to the Commission receipts for qualified
expenses as defined by paragraph 7 of subsection A of this section;
2.
The taxpayer shall retain all receipts of qualified expenses as proof of
the amounts paid each tax year the credit is claimed and shall submit them to
the Commission upon request; and
3.
If the credit exceeds the tax imposed by Section 2355 of Title 68 of the
Oklahoma Statutes, the excess amount shall be refunded to the taxpayer.
D. 1. a. For tax year 2024, the total amount of credits authorized by subparagraph a of paragraph 1 of subsection C of this section shall not exceed One Hundred Fifty Million Dollars ($150,000,000.00).
b. For tax year 2025, the total amount of credits authorized by subparagraph a of paragraph 1 of subsection C of this section shall not exceed Two Hundred Million Dollars ($200,000,000.00).
c. For tax year 2026, and subsequent tax years, the total amount of credits authorized by subparagraph a of paragraph 1 of subsection C of this section shall not exceed Two Hundred Fifty Million Dollars ($250,000,000.00).
2. For tax year 2025, and subsequent tax years, the total amount of credits authorized by subparagraph b of paragraph 1 of subsection C of this section shall not exceed Five Million Dollars ($5,000,000.00).
E.
The Commission shall prescribe applications for the purposes of claiming
the credits authorized by the Oklahoma Parental Choice Tax Credit Act and a
deadline by which applications shall be submitted. A taxpayer claiming the credit authorized by
subparagraph a of paragraph 1 of subsection C of this section shall submit an
application prescribed by the Commission to receive the credit in two
installments, each of which shall be half of the expected amount of tuition and
fees for the private school based on the affidavit submitted pursuant to this
subsection, but in no event shall an installment payment exceed half the amount
of the credit authorized by subparagraph a of paragraph 1 of subsection C of
this section. A taxpayer claiming the
credit authorized by subparagraph a of paragraph 1 of subsection C of this
section shall submit to the Commission an affidavit from the private school in
which the eligible student is enrolled or is expected to enroll with the
tuition and fees to be charged the taxpayer for the applicable school
year. In reviewing applications
submitted by eligible taxpayers to determine whether they qualify for a credit
authorized by subparagraph a of paragraph 1 of subsection C of this section,
the Commission shall give first preference in making installments to taxpayers
who qualify pursuant to divisions (1) and (2) of subparagraph a of paragraph 1
of subsection C of this section. The
Commission shall make the installments based on the expected amount of tuition
and fee amounts on the affidavit submitted pursuant to this subsection.
F.
Taxpayers claiming the credit shall:
1.
Only claim the credit for qualified expenses as defined in paragraphs 6
and 7 of subsection A of this section to provide an education for an eligible
student;
2.
Ensure no other person is claiming a credit for the eligible student;
3.
Not claim the credit for an eligible student who enrolls as a full-time
student in a public school district, public charter school, public virtual
charter school, or magnet school; and
4.
Comply with rules and requirements established by the Commission for
administration of the Oklahoma Parental Choice Tax Credit Program.
G.
Eligible students may accept a scholarship from the Lindsey Nicole Henry
Scholarships for Students with Disabilities Program created by Section 13-101.2
of Title 70 of the Oklahoma Statutes while participating in the Oklahoma
Parental Choice Tax Credit Program.
H. 1. The Commission shall have the authority to
conduct an audit or contract for the auditing of receipts for qualified
expenses submitted pursuant to subparagraph b of paragraph 1 of subsection C of
this section.
2. The Commission shall
be authorized to recapture the credits otherwise authorized by the provisions
of this act on a prorated basis if an audit conducted pursuant to this
subsection shows that the credit was claimed for expenditures that were not
qualified expenses or it finds that the taxpayer has claimed an eligible
student who no longer attends a private school or has enrolled in a public school
in the state.
I.
In the event of a failure of revenue pursuant to the Oklahoma State
Finance Act, the tax credits otherwise authorized in subsection C of this
section shall be reduced proportionately to the reduction in the amount of
money appropriated to the State Board of Education for the financial support of
public schools for the fiscal year in which the failure of revenue occurs.
J.
The Commission shall make available on its website the amount of credits
claimed each tax year pursuant to subparagraphs a and b of paragraph 1 of
subsection C of this section.
SECTION 3.
NEW LAW A new section of law
to be codified in the Oklahoma Statutes as Section 28-102 of Title 70, unless
there is created a duplication in numbering, reads as follows:
A.
The State Department of Education shall provide parents, legal
guardians, custodians, or other persons with legal authority of eligible
students with disabilities notice that participation in the Oklahoma Parental
Choice Tax Credit Program shall have the same effect as a parental revocation
of consent pursuant to 20 U.S.C., Sections 1414(a)(1)(D) and 1414(C) of the
Individuals with Disabilities Education Act (IDEA) and an explanation of the
rights parents, legal guardians, custodians, or other persons with legal
authority of eligible students with disabilities have under IDEA and any
applicable state laws and regulations.
B.
The Department shall implement a commercially viable, cost-effective,
and user-friendly system for users to publicly rate, review, and share
information about education service providers.
C. The Oklahoma Tax
Commission shall coordinate with the State Department of Education to develop a
process to review student enrollment information in order to verify that an
eligible student who is claimed by a taxpayer receiving a tax credit is not
enrolled in a public school in the state.
D.
The Commission may promulgate rules to implement the provisions of the
Oklahoma Parental Choice Tax Credit Act.
The State Board of Education may promulgate rules to implement the
provisions of this section.
SECTION 4.
NEW LAW A new section of law
to be codified in the Oklahoma Statutes as Section 28-103 of Title 70, unless
there is created a duplication in numbering, reads as follows:
A.
No liability shall arise on the part of the Oklahoma Tax Commission,
State Department of Education, State Board of Education, the state, a public
school district, a public charter school, a public virtual charter school, or a
magnet school based on the award of or use of a tax credit pursuant to the
Oklahoma Parental Choice Tax Credit Act.
B.
If any part of the Oklahoma Parental Choice Tax Credit Act is challenged
in a state court as violating either the Oklahoma Constitution or United States
Constitution, taxpayers shall be permitted to intervene for the purposes of
defending the Oklahoma Parental Choice Tax Credit Program’s
constitutionality. However, for the
purposes of judicial administration, a court may require that all taxpayers
file a joint brief so long as they are not required to join any brief filed on
behalf of any named state defendant.
C.
The provisions of the Oklahoma Parental Choice Tax Credit Act shall not
be severable, and if any provision of the Oklahoma Parental Choice Tax Credit
Act or the application thereof to any person or circumstances is held invalid,
such invalidity shall invalidate the other provisions or applications of this
act.
Passed the House of Representatives the 2nd day of May, 2023.
Presiding Officer of the House
of Representatives
Passed the Senate the 27th day of April, 2023.
Presiding Officer of the Senate
OFFICE OF THE GOVERNOR
Received by the Office
of the Governor this ____________________ day of ___________________,
20_______, at _______ o'clock _______ M.
By:
_________________________________
Approved by the
Governor of the State of Oklahoma this _________ day of ___________________,
20_______, at _______ o'clock _______ M.
_________________________________
Governor of
the State of Oklahoma
OFFICE
OF THE SECRETARY OF STATE
Received by the Office
of the Secretary of State this __________ day of ___________________,
20_______, at _______ o'clock _______ M.
By:
_________________________________